Press Releases
print

IFC Makes Its Largest Investment in Ukraine’s Financial Sector- HVB Bank Ukraine will receive $ 15 million Guarantee Facility


IFC, Washington                
Irina Likhachova  

Phone: +(202) 473 1813- Fax:+ (202) 974 4801

E-mail :
ilikhachova@ifc.org


Kiev, June 30, 2003—The International Finance Corporation (IFC), the private sector financing arm of the World Bank Group, signed an agreement today to provide a $15 million Guarantee Facility to HVB Ukraine (a  member of HVB Group).

This is the largest IFC’s investment in Ukraine’s financial sector, and the first IFC Guarantee Facility in the former Soviet Union. IFC’s guarantees will allow the bank to double a loan amount it can provide to a single client from $3 million up to $6 million and help the bank meet the growing needs of its Ukrainian clients, who are now requiring larger funding as a result of continued economic recovery in the country. These loans will be primarily used to finance new investments such as capacity increases, plant upgrades and other improvements in the agribusiness, manufacturing, and service industries.


"This Guarantee Facility will enable HVB Ukraine provide larger and longer-term financing to a broader base of Ukrainian private enterprises. Ukrainian companies’ growth is constrained by the lack of term financing, which is needed to upgrade and expand production. IFC’s strategy is to stimulate growth in the financial sector in Ukraine to support the country’s economic development", commented Mr. Edward Nassim, IFC’s Director for Central and Eastern Europe.


“IFC guarantee facility allows HVB Ukraine to develop further its core specialization in corporate financing. The facility will be used specifically to finance the medium-term borrowing needs of Ukrainian private sector companies across a range of sectors. It will help us increase our client base and diversify our lending portfolio,” said Mr. Gerd Wriedt, Chairman of the Management Board of HVB Ukraine.  


HVB Ukraine has been represented in the second largest country in Europe since August 1998. 70 employees in the head office in Kiev serve approximately 300 corporate customers. Shareholders in the bank are HVB Group which holds a 91.2% stake and IFC with an 8.8% interest. HVB Bank Ukraine is working profitably and is currently expanding its operations in Ukraine.


Last week the bank opened a branch office  in Kharkiv, the second largest city in the country. With more then 1 million inhabitants, Kharkiv is the economic center of the region. "Opening the branch office in Kharkiv is the starting shot for expanding our branch network in Ukraine," says Gerd Wriedt, Chairman of the Management Board of HVB Ukraine. Further branches will be opened in Odessa and Dnepropetrovsk this year. Still more are planned for 2004 and 2005.


The mission of IFC is to promote sustainable private sector investment in transition economies, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the emerging markets, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY02 (July 1, 2001 – June 30, 2002), IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.

HVB Group
Rene Beutner
Phone :+ (4989) 378 26001-Fax : +(4989) 378 25699
E-mail:rene.beutner@hvbgroup.com

HVB, Kiev
Dagmar Schulze
Phone: + (38044) 230 33 75- Fax: + (38044) 230 33 93
E-mail: dagmar.schulze@ua.hvb-cee.com